Buy Tata Motors; target of Rs 632: Prabhudas Lilladher

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26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Tata Motors

Tata Motors’ consolidated performance surprised positively with EBITDA margin at 12.5% (+250bps QoQ). Chip supply issue at JLR seems to be easing out as production grew 41% QoQ and is expected to gradually improve over 2022. JLR order book stands at 155k units vs 125k units in 2Q. It focused on pending bookings of Range Rover (wholesales +30% QoQ) as deliveries of New Range Rover are expected to start in 4Q. For standalone operations, the company has been able to gain market share across segments; PV market share at 12% vs 8% in FY21, CV at 45.4% (+300bps from FY21) and EV at ~82%.

Outlook

We maintain our positive stance on Tata Motors and reiterate as our top pick given (1) PV business is likely to gain further market share, led by new product launches and expanding portfolio. (2) CV volumes will benefit from cyclical upturn, improving fleet utilization and freight rates (3) new refreshes in Land Rover and strong order book to benefit JLR and drive FCF generation. We change our estimates by -2/+9% for FY23/24 to factor in the chip supply scenario. Maintain ‘BUY’ with a revised SOTP based Dec-23 TP of Rs 632 at 11.5x EV/EBITDA for standalone operations, 2.5x EV/EBITDA for JLR.

More Info

At 16:00 hrs Tata Motors was quoting at Rs 506.40, up Rs 2.10, or 0.42 percent.

It has touched an intraday high of Rs 514.40 and an intraday low of Rs 505.35.

It was trading with volumes of 604,766 shares, compared to its thirty day average of 1,175,469 shares, a decrease of -48.55 percent.

In the previous trading session, the share closed down 2.55 percent or Rs 13.20 at Rs 504.30.

The share touched its 52-week high Rs 536.50 and 52-week low Rs 255.55 on 17 November, 2021 and 01 February, 2021, respectively.

Currently, it is trading 5.61 percent below its 52-week high and 98.16 percent above its 52-week low.

Market capitalisation stands at Rs 168,155.53 crore.

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